Archive for Thursday, May 31, 2007

$7M in Wittig case in dispute

May 31, 2007


— Federal prosecutors and defense attorneys for former Westar Energy Inc. executive David Wittig on Wednesday argued over who should get control of $7 million he forfeited following his 2005 convictions for allegedly defrauding the Topeka-based utility.

An appeals court has since thrown out those convictions, including the forfeiture, and Wittig is scheduled to be retried Jan. 14 on some of those counts.

The $7 million was actually handed over by Wittig's wife, Beth, through an agreement she signed last year that allowed her to keep some of the couple's assets that were the targets of the forfeiture hearings. The agreement also prevented the government from trying to seize additional property.

After the 10th U.S. Circuit Court of Appeals overturned Wittig's convictions, the government returned the money to the Wittigs but also said it was revoking the agreement with Beth Wittig.

David Wittig's attorneys said the money belongs to their client and should be repaid to him without eliminating his wife's agreement. One of the attorneys, Jeff Morris, told U.S. District Judge Julie Robinson Wednesday he would hold the money in an interest-bearing account until after the next trial.

Prosecutors, however, want Robinson to determine the money is theirs to keep and are asking her to reimpose a slate of conditions on the Wittigs that would control how they spend money.

They have long charged that David and Beth Wittig have shifted assets around to hide them from authorities and make it appear David Wittig lacks the resources to pay fines and other penalties.

Assistant U.S. Attorney Richard Hathaway told Robinson that David Wittig's latest legal maneuvers are designed, in the event of a new conviction, to prevent prosecutors from seizing more than the $7 million, which represents a signing bonus and split-dollar insurance payments he received while working at Westar.

Morris replied that the government should live by the settlement agreement.

Robinson said she would rule after receiving more information from Morris of what assets he believes are off-limits to prosecutors.


Paul Geisler 11 years ago

Don't the Feds realize that even folks who hate Wittig hate seeing the Federal Gov't overstep their bounds like this just as much! I think they should give the money in escrow back to Wittig and wait and see what the results of the third trial will be. What ever happened to innocent until proven guilty (even after two failed convictions).

After 5 years without a paycheck and millions of dollars spent on legal fees it's not too hard for me to believe that his own personal assets have dwindled considerably. One would think the Feds would already consider their efforts successful, having destroyed Wittig's professional reputation and career and stripped him of nearly all of the money he earned at Westar. But apparently they think the third time's a charm.

I never have trusted the Feds on many levels, but this whole case has really opened my eyes to just how low they can go. Hathaway needs to let go of this personal vendetta against Wittig and move on to fighting more serious crimes.

pelliott 11 years ago

yeha, while I mistrust the feds, in this case, The millions looted from us is going to be divided by the legal eagles after cutting the deal to split it with the suspects. nice. No paycheck, my gosh. The feds didn't destroy Wittigs professional reputation,I believe he had something to do with it. He is considered really good at taking money, now we wait to find out if he can keep it and get away with it. Earned at Westar, wow. I wish the personal vendetta included wifey for hiding and abiding. Did you stash some of the utility money for him? i wish there was a vandetta against this type of crime. Instead the worry that if he spends time, will he be comfortable, his family secure in their mansion? After all he is well educated, white, he is a suit , he couldn't have gotten as much if he had entered the company from the front, gun drawn. More effective to get a salary while he did his thing.

Paul Geisler 11 years ago

pelliott, Based on your response I suspect your perspective is based solely on what has been reported in the local news. Too bad it's not the whole story. Even the jury in the second trial over-ruled the Feds and agreed to let Wittig & Lake keep their base salary for the years they were employed at Westar. After all, Wittig (& Lake) did do a lot of work for Westar during that time, whether you are willing to admit it or not. And the gains Wittig received from his employment at Westar were a pittance compared to the $800 million windfall that Wittig orchestarted with the sale of ADT stock to TYCO. Not to mention, much of what he was paid was put right back into the local economy and was in line with what other utility executives were getting paid at the time!

Agnostick, No such luck on the dashboard statues. I'm no fan of Kenny Boy or Fastow. Exactly where is Enron these days? Oh yeah, that's right, it imploded because of a bunch of phony accounting schemes and shell companies. And how does that compare to Westar? Well, it doesn't really. There never were shell companies at Westar. No grand accounting schemes to hide massive losses. Nope. Westar is still here, doing what it does as a utility, and generating profits for shareholders. And if you say that's only because Wittig & Lake were forced out and Haines was brought in, I don't buy it. Of the assets that Westar sold off to pay down debt under Haines direction, Protection One was sold for a considerable loss even though it is now profitable, and the shares of ONEOK Westar held would be worth way more now than what Haines sold it for. So who's approach was really better? Haines sold off assets for a loss, while Wittig is blamed for having invested in them in the first place (even though that's what he was hired to do). Please. Wittig was hired from Wall Street by John Hayes with the specific task of transforming Westar from a stodgy midwest utility into a diversified service-oriented conglomerate. And I don't recall the administration or shareholders asking WR customers if that's what they wanted their utility to do.

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